What will happen to the Real Estate market?

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What will happen to the Real Estate market?

Dylan Topolnisky
Real Estate Agent · Calgary, AB · Member since 2019 · 7 posts · 4 votes

Investors,

there are no right or wrong answers to this question, everyone please feel free to answer. In your opinion, what do you think will happen to your local, or national real estate market in the next year or two and why? Cheers :)

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Bob Prisco
Specialist · Cleveland, OH · Member since 2018 · 1k+ posts · 666 votes
6y

@Dylan Topolnisky  I can guarantee you it will go up and down :) If you are into it for cash flow, who cares about up or down, 10 -20% ?  If you get 10% +++ net caps, again who cares. You still collect your rent, Long term thinking always wins

Good Luck 

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  • Brandon P.
    Investor · Regina, SK · Member since 2017 · 76 posts · 56 votes
    6y

    Real estate prices have been trending downwards in AB and SK for a few years. The recent mass layoffs, oil price decline and slump in commodity prices will put downward pressure on the housing markets, especially in Alberta & SK. Fewer high paying jobs and widespread unemployment will force people to downsize or to move to a province with better job prospects.

    I expect there to be significant price declines for most residential real estate across Canada in the next year. My best guess is that the most significant impacts will be with more expensive homes, ie) +$500k in the prairies, +$1.5m in Ontario/BC. 

    We have no idea how long it will take for the economy to recover from the COVID shutdown. We do know that there are many companies and organizations laying off thousands of employees. As unemployment rates increase, demand for affordable housing will continue to increase. In 2 years, multi-family asset values will increase is most regions. Demand for downtown office space and parking will likely see a significant decrease as companies lay off more staff and realize that the office employees can work from home.

    We have already seen the trend in Calgary where office vacancies were hovering around 25% due to the decline in oil investment, corporate downsizing and companies re-locating their HQ out of AB and this was all happening before the prices crashed to $20 a barrel and when people were still commuting to work together in an office.



    1Reply
  • Aigo Pyles
    Flipper/Rehabber · Memphis, TN · Member since 2020 · 758 posts · 285 votes
    6y

    COVID has affected the local market these days. Some of real estate investors would want to pause for a while and hold their extra cash because of the situation right now. I think the market will go down for a while. But it will surely go up again. It is real estate.

    2Reply
  • Bob Prisco
    Specialist · Cleveland, OH · Member since 2018 · 1k+ posts · 666 votes
    6y

    @Dylan Topolnisky  I can guarantee you it will go up and down :) If you are into it for cash flow, who cares about up or down, 10 -20% ?  If you get 10% +++ net caps, again who cares. You still collect your rent, Long term thinking always wins

    Good Luck 

    6Reply
  • Danni Catambay
    Member since 2019 · 35 posts · 8 votes
    6y

    I'm guessing it's going dormant, like everything else, for a while. My local ears are hearing that people just don't want to make big changes right now -- buying or selling -- because of the uncertainty. 

    But what will happen for sure is that mortgage and eviction protections will lift and people who have destroyed their savings will be hungry for cash. I foresee a huge surge in supply of single family properties in the months after things open up again. 

    I'm personally planning to rake in. I have access to enough cash to pick up at least three new properties as rentals and as a wholesaler I'm planning to move a ton of inventory. 

    So all you investors out there: hold on to that cash cuz I'm gonna have deals galore!

    2Reply
  • James Sutton
    Real Estate Agent · Garland, TX · Member since 2011 · 12 posts · 7 votes
    6y
    I'm a Realtor in the Dallas area, I service all of DFW but mostly the greater Dallas side. What I'm seeing is only a little different than it was before the virus closed everything. In high demand areas, well priced homes are snatched up in 1 day just like before. But all of my buyers are in a holding patterns, just waiting for normal to return. I think that the number of sellers waiting for normal is probably equal to the buyers waiting for normal, and therefore the sellers market we're in will not change all that much. Now, I am assuming that we're pretty much at the end of the shutdown. Surrounding counties didn't lockdown at all. I do think more buyers will decide to move to surrounding counties a little more than before as some will have made a successful transition to working from home and will want to move further away from large population centers where they can get more house and land for their money. I do believe there will be an increase in foreclosures, but I do not think the banks will want to foreclose too much and too quickly. There will be opportunity for investors for sure! I do agree with Brandon P. that the most impact will be on the higher end markets as far as any significant price decreases but depending on what state you're talking about the amount will be significantly different. California and New York will once again be hit much harder than Texas just like the last major event, but I do not think this will end up being a major impact event on the majority of real estate. I sure hope I'm not wrong!
    2Reply
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    6y

    Highly specific to the local market, and even varyied within each market. 

    [email protected]301-893-4635Podcast Guest on Show #192
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    1Reply
  • Gail W.
    Investor · IL · Member since 2019 · 151 posts · 135 votes
    6y

         Here in South central Illinois, it seems to me investors have slowed their buying but not stopped entirely. I do believe rents may come down a little but not a lot as the rents are already fairly low compared to the rest of the country. This area is hard hit by a loss of jobs and HIGH taxes. Property taxes are very high here and state income tax also so landlords and tenants both take the tax hit. Appreciation has been slower here than elsewhere in the country except for the last couple of years, so maybe the correction will wipe out any gains in value since 2017 or 2018.

         In any case just my 2 cents. That and $1.50 will get you a cup of coffee most places. 

    2Reply
  • Sam Josh
    Sunnyvale , CA · Member since 2017 · 373 posts · 362 votes
    6y

    @Dylan Topolnisky

    The short answer is RE is highly correlated to jobs in the area. If jobs in the area are being impacted, RE will be impacted.

    1Reply
  • Guy Bouchard
    Member since 2020 · 67 posts · 110 votes
    6y

    Like Vegas and other tourism cities. RE prices will decline. 

    1Reply
  • Armando Gomez
    Member since 2019 · 24 posts · 6 votes
    6y

    @Danni Catambay

    I will be ready to buy

    1Reply
  • M. Anthony Contrascere
    Colorado Springs · Member since 2019 · 19 posts · 8 votes
    6y

    At least in the CO Springs area, our market was so strong before this virus hit, so Im suspecting there wont be as much of an impact here as other places with weaker markets.  

    On the flip side, you can’t put a third of Americans out of work and not expect to see it impact everything, including housing. We have no precedent for what is happening though, so no one is really sure of when it will start to really impact the market. For example, between mortgage forbearance being mandated and the time it takes to foreclose, it could easily be 6-12 months before we see any foreclosure related sales.

    Anything written by a realtor or published by any organization in the real estate industry (NAR, HBA, PPAR, Lenders, etc.) should not be trusted. It will almost certainly be overly optimistic until something negatives hits them like a wrecking ball across the face. Unfortunately Im already seeing real estate entities put out misleadingly optimistic information. We'll see how that changes in the near future. Just read all of real estate forecasts with caution and discernment!

    4Reply
  • Aigo Pyles
    Flipper/Rehabber · Memphis, TN · Member since 2020 · 758 posts · 285 votes
    6y
    Originally posted by @Mike Morawski:

    Right now I am going to lay in the weeds and watch.  I firmly believe when our leaders finally get this whole thing under control there will be some great real estate deals to be had.  Who would have thought the great economic crisis of 2008 would have done what it did.  Just watch......

     The situation is different right now. It is a different war. 

    0Reply
  • Mark Bacon
    Member since 2016 · 5 posts · 4 votes
    6y

    In the middle of a transaction and very nervous. I'm not seeing this turn around anytime soon. I think once the food shortages start people will wake up. May be too late at that point.

    0Reply
  • Ryan RohlfPro Member
    Real Estate Agent · Des Moines, IA · Member since 2020 · 7 posts · 3 votes
    6y

    I'm in real estate in the Des Moines, Iowa, market. The market is still currently pretty strong. We are seeing a sellers market up to about 250k. It feels like a typical spring market here. With rates being low right now, we are still seeing things moving pretty quickly. This has, however, impacted some buyers with the updated government loan guidelines and due to furloughs or layoffs, so there is definitely an impact. I honestly thought we'd see more of a decline, yet things are remaining strong. My guess is Iowa will remain fairly level as we continue to move through this, mainly because we didn't see as big of impact as many of the costal cities did back in the financial crisis.

    [email protected]515-442-0625
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  • Darson GranthamBusiness Member
    Realtor · Des Moines · Member since 2018 · 304 posts · 253 votes
    6y

    @Ryan Rohlf The Iowa, specifically Des Moines market, will be very interesting IMO.  We, as a state, didn't do the full shutdown like many other states did and I wonder if that will ramp up or economy a bit faster than others.

    OR it may be that other markets dropped fast and will recover fast (the now famous V shape recover).

    It will be so interesting to look back in 1-5 years and compare different markets.

    Wishing everyone the best!

    [email protected]515-612-6013
    0Reply
  • Ryan RohlfPro Member
    Real Estate Agent · Des Moines, IA · Member since 2020 · 7 posts · 3 votes
    6y

    @Darson Grantham - Agreed. It's hard to say what the full impacts will be as this continues as well. The movement we are seeing right now could also be skewed to pre-COVID times, as folks that were looking before all this started have found something and purchased or continued to look if they haven't experienced any pandemic related hardships. I think a few months down the road we will have a much better idea of the forecast. 

    [email protected]515-442-0625
    0Reply
  • Darson GranthamBusiness Member
    Realtor · Des Moines · Member since 2018 · 304 posts · 253 votes
    6y

    @Ryan Rohlf The Iowa, specifically Des Moines market, will be very interesting IMO.  We, as a state, didn't do the full shutdown like many other states did and I wonder if that will ramp up or economy a bit faster than others.

    OR it may be that other markets dropped fast and will recover fast (the now famous V shape recover).

    It will be so interesting to look back in 1-5 years and compare different markets.

    Wishing everyone the best!

    [email protected]515-612-6013
    1Reply
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